COMMENT: We’ve spoken at length and in detail of the Vatican’s political and economic intimacy with the Axis prior to, during, and after World War II. (AFA #’s 17-21 will fill listeners in on the fundamentals of the discussion. FTR #504 [among other programs] highlights the Vatican financial infrastructure’s involvement with Nazi industry.)

Several listeners have noted the story highlighted here, setting forth the evolution of “Vatican Incorporated” and its lucrative investments in the real estate industry.

It is interesting to contemplate the fate of the Vatican’s balance sheet after the real estate bubble collapsed.

EXCERPT: Few pass­ing Lon­don tourists would ever guess that the premises of Bul­gari, the upmar­ket jew­ellers in New Bond Street, had any­thing to do with the pope. Nor indeed the nearby head­quar­ters of the wealthy invest­ment bank Altium Cap­i­tal, on the cor­ner of St James’s Square and Pall Mall.

But these office blocks in one of London’s most expen­sive dis­tricts are part of a sur­pris­ing secret com­mer­cial prop­erty empire owned by the Vatican.
Behind a dis­guised off­shore com­pany struc­ture, the church’s inter­na­tional port­fo­lio has been built up over the years, using cash orig­i­nally handed over by Mus­solini in return for papal recog­ni­tion of the Ital­ian fas­cist regime in 1929.

Since then the inter­na­tional value of Mussolini’s nest-egg has mounted until it now exceeds £500m. In 2006, at the height of the recent prop­erty bub­ble, the Vat­i­can spent £15m of those funds to buy 30 St James’s Square. Other UK prop­er­ties are at 168 New Bond Street and in the city of Coven­try. It also owns blocks of flats in Paris and Switzerland.

The sur­pris­ing aspect for some will be the lengths to which the Vat­i­can has gone to pre­serve secrecy about the Mus­solini mil­lions. The St James’s Square office block was bought by a com­pany called British Grolux Invest­ments Ltd, which also holds the other UK prop­er­ties. Pub­lished reg­is­ters at Com­pa­nies House do not dis­close the company’s true own­er­ship, nor make any men­tion of the Vatican. . . .

. . . British wartime records from the National Archives in Kew com­plete the pic­ture. They con­firm Profima SA as the Vatican’s own hold­ing com­pany, accused at the time of “engag­ing in activ­i­ties con­trary to Allied inter­ests”. Files from offi­cials at Britain’s Min­istry of Eco­nomic War­fare at the end of the war crit­i­cised the pope’s financier, Bernardino Nog­ara, who con­trolled the invest­ment of more than £50m cash from the Mus­solini windfall.

Nogara’s “shady activ­i­ties” were detailed in inter­cepted 1945 cable traf­fic from the Vat­i­can to a con­tact in Geneva, accord­ing to the British, who dis­cussed whether to black­list Profima as a result. “Nog­ara, a Roman lawyer, is the Vat­i­can finan­cial agent and Profima SA in Lau­sanne is the Swiss hold­ing com­pany for cer­tain Vat­i­can inter­ests.” They believed Nog­ara was try­ing to trans­fer shares of two Vatican-owned French prop­erty firms to the Swiss com­pany, to pre­vent the French gov­ern­ment black­list­ing them as enemy assets.

Ear­lier in the war, in 1943, the British accused Nog­ara of sim­i­lar “dirty work”, by shift­ing Ital­ian bank shares into Profima’s hands in order to “white­wash” them and present the bank as being con­trolled by Swiss neu­trals. This was described as “manip­u­la­tion” of Vat­i­can finances to serve “extra­ne­ous polit­i­cal ends”.

The Mus­solini money was dra­mat­i­cally impor­tant to the Vatican’s finances. John Pol­lard, a Cam­bridge his­to­rian, says in Money and the Rise of the Mod­ern Papacy: “The papacy was now finan­cially secure. It would never be poor again.” . . .

. . . From the out­set, Nog­ara was inno­v­a­tive in invest­ing the cash. In 1931 records show he founded an off­shore com­pany in Lux­em­bourg to hold the con­ti­nen­tal Euro­pean prop­erty assets he was buy­ing. It was called Groupe­ment Financier Lux­em­bour­geois, hence Grolux. Lux­em­bourg was one of the first coun­tries to set up tax-haven com­pany struc­tures in 1929. The UK end, called British Grolux, was incor­po­rated the fol­low­ing year. . . .

. . . While secrecy about the Fas­cist ori­gins of the papacy’s wealth might have been under­stand­able in wartime, what is less clear is why the Vat­i­can sub­se­quently con­tin­ued to main­tain secrecy about its hold­ings in Britain, even after its finan­cial struc­ture was reor­gan­ised in 1999.
The Guardian asked the Vatican’s rep­re­sen­ta­tive in Lon­don, the papal nun­cio, arch­bishop Anto­nio Men­nini, why the papacy con­tin­ued with such secrecy over the iden­tity of its prop­erty invest­ments in Lon­don. We also asked what the pope spent the income on. True to its tra­di­tion of silence on the sub­ject, the Roman Catholic church’s spokesman said that the nun­cio had no comment.

This is additionally timely in light of the impending papal resignation and the ongoing scandals brewing around the Vatican Bank and its past relationships with Banco Ambrosiano, in which it was the major shareholder, and the so-called Vatileaks scandal involving internal Vatican documents, letters and diplomatic cables that were allegedly taken by the pope’s butler and leaked to Italian journalists.

Mr Emory had done a series of shows about the Vatican Bank corruptions years ago which are worth checking out.